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EU hits Google with 2.4bn euro fine

The EU hit Google with a record 2.4-billion-euro fine Tuesday for illegally favoring its shopping service in search results, in a fresh assault on US firms that risks the wrath of President Donald Trump.

Hard-charging European Commission competition chief Margrethe Vestager said the tech giant “abused its market dominance” as the world’s most popular search engine to give an advantage to its Google Shopping service.

“What Google has done is illegal under EU antitrust rules,” Denmark’s Vestager told a news conference in Brussels.

“It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.”

Google now has 90 days to “end this conduct” or face further fines, Vestager said. These could amount to five percent of Google’s daily revenue, she added, a penalty of roughly $14 million a day.

The fine broke the previous European Union record for a monopoly case against US chipmaker Intel of 1.06 billion euros in 2009.

Google said it “respectfully” disagreed with the EU decision, which followed a seven-year investigation, and may appeal.

“When you shop online, you want to find the products you’re looking for quickly and easily. And advertisers want to promote those same products,” Kent Walker, Google’s senior vice president and general counsel, said in a statement.

“That’s why Google shows shopping ads, connecting our users with thousands of advertisers, large and small, in ways that are useful for both.

“We will review the Commission’s decision in detail as we consider an appeal, and we look forward to continuing to make our case.”

Google Shopping shows the images and prices of products in response to shopping-related searches when someone uses the search engine.

Google CEO Sundar Pichai delivers the keynote address at the Google I/O 2017 Conference at Shoreline Amphitheater on May 17, 2017 in Mountain View, California. (Photo by AFP)

Brussels accuses Google of giving its own service too much priority in search results to the detriment of other price comparison services, such as TripAdvisor and Expedia.

The EU alleges that in 2008 Google embarked on a “fundamental change in strategy” by devoting top of the page priority to Google Shopping, pushing rivals further down the page.

The verdict comes less than a year after Vestager shocked Washington and the world with an order that iPhone manufacturer Apple repay 13 billion euros in back taxes in Ireland.

The Google fine could also set an important precedent for other Google services, such as for images, news and travel that have also received complaints from rivals.

Wall Street Journal publisher News Corp, a major Google critic, “applauded” the decision as an important precedent “in remedying Google’s shameless abuse of its dominance in search”, the company said.

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